Judy Asks: Can the Iran Nuclear Deal Be Rescued?

Azadeh ZamiriadDeputy head of research, Middle East and Africa Division at the German Institute for International and Security Affairs

It can be saved, for now. But the road just got bumpier. No doubt, the newly reimposed U.S. sanctions will affect Iran’s financial transactions and hit its energy sector hard. However, as long as widespread international support remains in place and Iran’s major buyers—notably China and India—continue to import a reasonable amount of oil, Tehran is unlikely to pull out of the nuclear deal. After all, the grass isn’t any greener on the other side. If Iran stops implementing the nuclear agreement, it risks adding even more sanctions to the mix and facing a realigned international block.

Yet ongoing Iranian commitment to the JCPOA is not a given, as pressure is continuously rising within the country. It will be ordinary Iranians who will suffer most from worsening economic conditions in the coming months. Keeping Iran in the JCPOA in this environment will require substantial international backing across the board, including financial aid, functioning channels for financial transactions, continued energy imports, and ongoing political support for the deal. The JCPOA can be kept alive for the time being, but as long as Washington remains out of the agreement, the current crisis mode will continue.

Pierre VimontSenior fellow at Carnegie Europe

Rescuing the Iran nuclear deal is something for the long term, if ever a total collapse is avoided. Right now expediency is the name of the game.

The ongoing efforts on the EU side are not dwelling on possible ways of completing the nuclear deal. They simply aim at keeping Iran on board. Updating the old blockade legislation or resorting to a new barter mechanism is about publicly demonstrating that Europe is sticking to its part of the agreement and hoping that Iran will do the same. This course is not without contradictions. While not preventing EU firms from moving out of Iran, it plays into U.S. hands by mitigating the adverse effects of the American withdrawal. Additionally, it ramps up confrontation—with Europe appearing as the main challenger to the U.S. sanctions.

Rather than the American sanctions, the real threat to this European course may well in the end come from Iran itself. More precisely, the Tehran regime’s radical wing—through its opposition to domestic legislation on money laundering and its recently clandestine operations in Denmark or France against the Iranian opposition—could compel Europe to resort to new sanctions and unravel all the ongoing efforts to protect bilateral cooperation from a very toxic environment.

Sanam VakilProfessional lecturer at The Johns Hopkins University SAIS Europe and senior consulting research fellow at Chatham House

Keeping the Iran nuclear agreement or JCPOA alive is in the interest of all parties, especially the Trump administration. Despite the U.S. withdrawal from the deal and the reimposition of sanctions on Iran, none of the agreement’s signatories would like to see Tehran withdraw from the deal and restart its nuclear program. This would be a disastrous outcome that would be blamed on Washington and would not result in any of America’s stated objectives vis-à-vis Iran.

Ironically, the Trump administration has saved the deal already by recognizing the limits of its unilateral strategy on Iran, by granting oil waivers to its allies, by not blocking SWIFT, and by safeguarding some aspects of civilian nuclear cooperation. The Trump administration is also looking to heal transatlantic tensions with the E3 (France, Germany, and the United Kingdom). By doing so, Washington hopes to rely on the EU to safeguard the deal and to start the arduous process of bringing Iran on board to work toward a stronger agreement that can address the outstanding issues of missiles and Iran’s regional involvement. This is no easy task, but the only route that will keep the deal on life support long enough to kick-start the diplomatic process.

Ali VaezDirector of the Iran Project at the International Crisis Group

Yes, the Iran deal can be rescued, but on life support. There is no doubt that the remaining signatories to the JCPOA cannot completely mitigate the impact of unilateral U.S. sanctions against Iran. Their efforts, however, constitute a political victory for Tehran in the short term and could, in the medium term, bring about some economic dividends. In the meantime, the Iranian leadership is using international sympathy and its unfamiliar diplomatic high ground as justification at home for remaining in the deal. The alternative (i.e. a renewed nuclear crisis and international consensus against Iran, including multilateral sanctions) will be more damaging for Tehran; thus the low threshold for its continued commitment to the deal.

Yet if sanctions turn out to be as devastating as the Trump administration is hoping for, at some stage the leadership in Tehran might throw prudence out the window, revive its nuclear program, and/or resort to asymmetric retaliation in the region against Washington or its allies. A crisis can change the issue domestically and allow the hardline core of the Islamic Republic to consolidate power.

Stephen SzaboAdjunct professor at The Johns Hopkins University SAIS Europe

The short answer is no. The United States still remains the indispensable power in the Iran case, as in many others. In some areas, like climate change, Washington isolates itself and the rest of the world moves on. On trade the jury is still out, but it seems that the American position remains the key to the larger global trading system.

In regard to Iran it is increasingly clear that the nuclear deal will fail without American participation and its active opposition. Here again, the size of the U.S. market and the role of the dollar combined with extraterritorial sanctions will prevail. In addition, Iran is not helping its case with the other signatories of the agreement with its continued support for terrorism, its role in the Syrian civil war, and now its actions in Denmark and elsewhere in Europe against Iranian dissidents. What the consequences will be is uncertain, but it is unlikely the American position will change, as all of President Trump’s key foreign policy officials agree on the need for a tough line regarding Tehran. The Europeans will also begin to fall into line reluctantly behind Washington given these realities.

Shimon SteinSenior fellow at the Institute for National Security Studies, Tel Aviv University

The answer to the question depends to a large extent on the degree to which the EU-3 (France, Germany, and the United Kingdom) together with China and Russia can work around the U.S. sanctions (and thus, live up to their economic and financial commitments under the deal), so as to incentivize Iran to continue adhering to the nuclear agreement. Given the initial efforts, the prospects of that endeavor succeeding are not high.

These efforts take place against the backdrop of President Trump’s continuing determination to pressure Iran economically (especially in the oil and financial sectors), hoping that it will bring the country back to the negotiating table. Then Trump could say that—as opposed to former president Obama—it was he who delivered the United States a better deal, even if the newly negotiated one might not differ much from the original (just recall the new NAFTA). And so one will have to see under what circumstances (if at all) the Iranians will decide that it is in their interests to negotiate a new deal with the United States or simply wait (with many of us) President Trump out.

Marietje SchaakeMember of the European Parliament

No. The JCPOA as agreed by the major global powers at a critical time was fatally damaged by President Trump’s withdrawal. That does not mean all is lost; a reduced JCPOA may still work, but European leaders need to get real.

Yes, High Representatives Ashton and Mogherini stuck their necks out for diplomacy. This was the right choice, but it also had a shadow side, overlooking human rights violations and Iran’s troubling role in the Middle East. Rebalancing the EU’s approach toward Iran is now, again, hindered by a defensive stance on the nuclear deal.

Attempts to maintain policy independence and to give European companies maximum choice to do business are positive steps. The EU lifted sanctions as its part of the deal, while Iran commits to verification of its nuclear enrichment. But to push or even punish European companies for choosing to drop business with Iran under threat of U.S. repercussions is taking it too far. Additionally, the impression that the EU and Tehran are in one “camp” and the United States in another is deplorable.

The way forward for Europe is to broaden its Iran policy to include human rights and foreign policy concerns, while taking reasonable steps to stay committed to its part of the nuclear deal.

Nora MüllerHead of The International Affairs Department at the Körber Foundation

The JCPOA was widely praised as a victory of diplomacy in general and of European statesmanship in particular. But the EU’s efforts to salvage the Iran nuclear deal may well go down in history as testimony to European impotence in the face of U.S. dominance of the global financial system.

To be sure, the EU made a point of standing up to U.S. pressure. By reactivating the Blocking Statute and by establishing a Special Purpose Vehicle to facilitate financial transactions into and out of Iran, Europeans clearly signaled they were serious about upholding their part of the deal. Alas, upholding the JCPOA was always going to take more than politics and symbolic action. From the point of view of European multinationals, it all comes down to a hard-nosed economic cost-benefit analysis. Facing a choice between the U.S. and the Iranian markets, Airbus, Peugeot, Siemens, and other corporates have made a decision as predictable as it is comprehensible.

With new, more biting U.S. sanctions kicking in and the EU unable on its own to deliver the kind of benefits Iran’s economy needs to reverse its current downward trend, the incentives for Tehran to stay in the JCPOA will dwindle. The survival of the Iran nuclear deal has never been at greater risk.

Denis MacShaneFormer UK minister for Europe

Almost certainly not, unless Iran agrees to drop its ambition to lead the Muslim world in a struggle to the death against Sunni Islam and Gulf Arabs and withdraw into building up a strong Iranian nation that serves its people rather than its Ayatollahs.

Iran’s behavior since signing the deal in 2015 has confirmed the fears of the anti-Iran lobby, headed by John Bolton in Washington; most Israeli politicians; and Trump allies, like MBS in Saudi Arabia.

The architects of the deal—such as America’s John Kerry or France’s Laurent Fabius—have gone, and Federica Mogherini is in her last stretch as Europe’s foreign policy spokesperson. The hopes arising from the Lisbon Treaty that creating a unified EU External Action Service with a single high representative have not been fulfilled.

Iran’s crude and blatant support for Hezbollah, with its unvaried anti-Jewish rhetoric, has simply demoralized the world community. Of course, Trump’s posturing and preening and loathing of anything shaped by his predecessor is the proximate cause. But Iran has not helped itself, and EU leaders should have been much clearer that if Iran continued to be a destabilizer in the region, then sooner or later the nuclear deal would implode.

Ellie GeranmayehDeputy head of the MENA program at the European Council on Foreign Relations

Despite the significant pressures exerted by U.S. sanctions, the nuclear deal can be salvaged if the remaining JCPOA members double down on their current efforts.

The manner in which the White House has reimposed its latest sanctions suggests that it seeks to keep Iran boxed into the nuclear restrictions under the JCPOA without providing the economic benefits envisaged when the deal was struck. This is likely to be part of the Trump administration’s tactic to force Iran to either walk or talk.

So far Tehran has shown restraint and strategic patience. Iran has implemented its nuclear commitments while reaching out to Europe, China, Russia, and Asian powers to find tangible economic relief. European attempts to create the Special Purpose Vehicle (SPV) are being closely watched not just by Iran but also the United States and Israel, who are likely to undermine efforts that sustain trade channels with Tehran.

However, the JCPOA is not purely an economic barter for Iran but entails important security and political dimensions. The coming months will prove crucial as Tehran calculates whether the deal provides enough overall dividends. If the SPV cannot be operationalized soon, this will have a significantly negative impact on Iran’s calculations as to the benefits of remaining in the JCPOA.

Jarrett BlancSenior fellow in the Geoeconomics and Strategy Program at the Carnegie Endowment for International Peace

Yes. A rump version of the Joint Comprehensive Plan of Action (JCPOA) in which Iran gets many fewer benefits than it expected but stays in compliance with its nuclear commitments is possible, at least in the middle term. It will depend mainly on:

China, Iran’s largest trading partner, continuing to purchase Iranian oil and conducting close-to-normal commerce. The lack of detail in the Trump administration’s announcements about oil waivers for China and others suggests this is a live possibility.

Europe continuing to provide robust political support to Tehran, demonstrating that the United States has failed to isolate the country diplomatically. As part of this, the EU will need to establish the promised Special Purpose Vehicle (SPV) to show its independence from Washington, but no one is expecting that the SPV will actually carry much trade.

China, Russia, and Europe continuing to fulfill their nuclear commitments under the JCPOA, including Arak and Fordow redesign.

Under these conditions, it might be preferable for Iran to try to wait for a change in U.S. policy. If the pressure on Tehran becomes too great to continue waiting, they will likely peruse provocative policies—including violating the JCPOA’s nuclear terms—rather than returning to negotiations while still in compliance.

Cornelius AdebahrNonresident fellow at Carnegie Europe

The nuclear deal is many things to different people. At its core, it is about containing the Iranian nuclear program. As such, it will remain alive for as long as Tehran respects the agreement’s terms, even without receiving the promised economic rewards. The deal was also meant to become a stepping stone for regional cooperation, including on security matters. In this regard, it has failed, mostly because regional actors—Iran included—see more value in pursuing a power-based approach.

Ever since the U.S. administration withdrew from the deal, the agreement has become the object of a geopolitical contest: Can Washington impose its will on countries and companies on a global scale? Or will its short-sighted pursuit of unilateral goals propel other powers to escape America’s economic and financial reach?

Rescuing the deal thus becomes part of making a broader point about the world order. Even countries who don’t necessarily care much about Iran or its nuclear program feel that ripping apart an international agreement that was endorsed by the UN Security Council three years ago and has proven to work within its confines until the present day is not responsible policy. They will feel emboldened by the results from the U.S. midterm elections.

The failure of the neo-liberal global system -- that is, it's gross inequality -- has created a US voter backlash against American foreign security guarantees. The vacuum ensued within the Middle East geopolitical system has meant that US policy under Trump can only use economic clout to achieve a more robust strategic regime with regard to Iran. But in order to get an enhanced nuclear deal within a non-hegemonic regional structure will require a global economic commitment between Washington, its allies and its Russian and Chinese adversaries. Trump does not have the global capital to achieve such a deal. In fact, the entire edifice of the NPT has now become unmoored due to the slow decline of American unipolarity. From a Middle East point of view the JCPOA was nothing more than a weak and temporary stopgap. It was designed by the Obama administration in order to " kick the can down the road", so that, some other American president would have to deal with the problem. But current American policy with regard to the NPT (and the JCPOA) can not be achieved in isolation or in a vacuum of international security cooperation. "America First" will only engender "Russia First", "China First" and perhaps "Germany and/or "Japan First". Such international chaos can only mean the expansion of nuclear power. The hope of the NPT, as envisioned during an era of a secure deterrence with strategic negotiation, is not the era of today. Now, with Iranian encroachment into the orbit of Israel and the Sunni Arab states; it is not inconceivable to view Saudi Arabia, Jordan and Egypt as potential nuclear states. Turkey, of course would probably go the same way. Can such an environment breed a secure deterrent structure? The answer is an unequivocal no. But a return in 2021 to a weak JCPOA without a prohibition on regional hegemony, or the curtailment of both offensive and defensive missile technology, would swiftly become a nuclear-nightmare scenario. First strike nuclear capacity was always a concern during the Cold War (at least until the ABM Treaty) and would be a disaster in the Middle East. It is up to the new Global-4 -- China, India, Russia and the US -- to work with Israel and the Sunni Arab states on a structure of regional peace which excludes nuclear weapons. Within this context, Iran would be asked to join. It is time for the Global-4 to work out their own problems with each other; so that they can begin to lead the world toward a structure of peace. Time is short!

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Alexis de Pleshcoy

November 09, 20181:56 am

Adebahr summarizes perfectly the many facets of this discussion.
JCPOA was supposed to be a stepping stone in the right direction, a trust building step. In a similar fashion ABM and INF led to CFE and START’s but in the end, there was no trust, and all slowly returned where it started: The Doomsday Clock two minutes to end, same as in 1953.
It was sanctioned by the UN, a cornerstone institution initiated by the US at the end of the second act of the Great War started in 1914 in the Western civilization. It appears more and more the UN follows the path of the League of Nations, Briand-Kellog and the many other international peace efforts, led by the US after the first act of the Great War.
Bretton-Woods put the US dollar at the core of the world financial system, riding on SWIFT, a European invention. This “exorbitant privilege” survived the Nixon shock, Plaza Accord, the outsourcing of everything anywhere a buck can be saved. The consistent use of financial sanctions is now threatening this position, in addition to the rise of the Rest; it is not just the IMF recognizing the yuan, but a plethora of other new financial instruments, including the return of gold.
Iran kept the letter of the treaty, the spirit is a developing story, and not in the right direction (MacShane, Vimont cover this extensively).
What is surprising is that India, the super hyper power in waiting is relegated to one reference, and not aligned with her multidimensional rise; Pakistan is absent also, but both are there, including gas and pipelines, as always.
In a different world the world should be concerned by the lack of water in India, Pakistan and Iran. Iran is affected by a severe drought, while the growing populations of India and Pakistan led to the India Pakistan water dispute, with all its possible consequences.
The Sunni-Shia divide is not mentioned as critical (the 1054 Great Schism is not that different), Saudi Arabia and Israel cursory.
On a separate note, if JCPOA is the pride of EU collective diplomacy, the EU is in big trouble. The largest, wealthiest entity in Western history doesn’t appear to influence decisively the world affairs.
It will probably be like this for the foreseeable future, with Brexit a major blow even if reverted.
Let’s not forget that Deveselu Aegis Ashore ABM system was deployed to protect Europe against Iran’s missiles, with the US youth borrowing $800 million to pay for it; the EU should have been more concerned about any missiles program.

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Bobby

November 16, 201811:08 pm

It can definitely be saved but only if Iran and EU work diligently and in certain cases they both will face some sacrifices. However EU needs to see long term interest of the European States. If the deal collapses there will be instabilities and numerous tensions in a large region stretching from the Mediterranean Sea to Hindu Kush which likely will lead to wars. The current Iranian regime has numerous weaknesses and bad behaviours . But Arabs , Israelis and Turks have equally bad ones...If Iran becomes unstable and weak whose influence will exert over it.Most probably Russia and China.
If Russia has strategic control over gas reserves of Iran EU energy securities will suffer. Moreover EU will have to compete with China in advanced industries if not in China itself almost certainly in all of Eurasia except it. So it is strategically necessary to have Iran as a junior partner in 21st Century Great Game because of its location, its unique influence over Central Asia, South Asia and Middle East. US has stable near environment ( Mexico and Canada) . EU needs stable middle east too.
US can involve itself in middle east crisis or not. Look at Iraq War and Syrian Civil War. It does not have any effect on near abroad of US.
If trade and investment opportunities of modest proportion cannot even be given to Iran ,EU should consider to employ highly educated and unemployed iranians in its industries.
EU will need talented workforce in future anyway since the whole Europe is aging fast and in some cases like Germany has aged already. Khameini won't live forever. It is likely Prowestern government will arise in iran. It may not be pro-American but it can be pro European.

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